Rapid advances in technology, especially in information technology, have driven U.S. economic performance for the past decade. Technological innovation serves as the underpinning for strong economic growth, higher rates of investment, low inflation, high-wage job growth, low unemployment, and solid increases in productivity—the true path for producing higher standards of living. Rapid advances in technology are transforming all of our human endeavors, creating the potential for a host of new global market opportunities, new and powerful ways to secure our nation, improvements in our standard of living, and a better quality of life.

Meanwhile, global competition is intensifying. Other nations have recognized the link between technology and growth and are rapidly expanding their scientific and technological capabilities. The United States has sought to address these new economic and competitive realities by developing both domestic and international policies and programs that enhance U.S. competitiveness in the global marketplace and maximize technology's contribution to national economic growth, job creation, and quality of life. A clear role for government has been articulated in fostering the development of civilian technology in partnership with industry and the science and technology communities and emphasizing the creation of a favorable business climate to promote innovation.

The Technology Administration (TA) serves as a focal point for these efforts, helping to ensure that American companies and workers have the tools needed to compete and win in today's global economy. TA is the primary federal agency charged with the explicit mission of working with U.S. industry to accelerate innovation and maximize technology's contribution to U.S. economic growth. TA seeks to encourage the development of the technological infrastructure required to support U.S. industry through the 21st century; to foster the development, diffusion, and adoption of new technologies; to disseminate information on U.S. and foreign technology strategies and best practices; and to create a business environment conducive to innovation.

Led by the Under Secretary for Technology, TA fulfills its broad responsibilities through the Office of the Under Secretary and its three component organizations, the Office of Technology Policy (OTP), the National Institute of Standards and Technology (NIST), and the National Technical Information Service (NTIS). A brief description of each is provided below.

Under Secretary for Technology works with U.S. industry to maximize technology's contribution to U.S. economic growth, global competitiveness, and innovative capacity.

Office of Technology Policy (OTP) is the only office in the federal government with the explicit mission of developing and advocating national policies and initiatives that use technology to build America's economic strength. During the past decade, dramatic changes have taken place in the climate for innovation—new digital technologies and networks are transforming our forms of commerce; R&D, competition, and markets are now global; and technological progress is accelerating. These changes have profound implications for technology policy, regulations and laws, economic and tax policies, investments in human capital, and how R&D investments are allocated and managed. Analyzing these changes—and making recommendations to maximize technology's contribution to the economy and improve the environment for technological innovation—is a key OTP mission. Working in partnership with the private sector to achieve this objective, OTP also focuses on the creation of high-wage jobs and improvements in our quality of life, monitoring foreign government science and technology policies, and encouraging the adoption of policies that promote a favorable environment for U.S. business overseas. OTP also promotes productive research between the federal government and private-sector programs across the full spectrum of federal research programs.

National Institute of Standards and Technology (NIST) works with U.S. industry to address technology needs, delivering broadly useful results shared among companies, industries, and consumers. The NIST Laboratories provide industry and science with the measurement capabilities, standards, data, and test methods that are needed to enhance productivity, facilitate trade, and improve the quality of life. NIST also plays a key role in supporting the nation's homeland security initiatives. In addition to its core laboratory measurement, testing, and standards functions, NIST conducts three extramural programs: the Advanced Technology Program, to stimulate the development of high-risk, broad-impact technologies by U.S. firms; the Manufacturing Extension Partnership, to help smaller businesses adopt new manufacturing and management technologies; and the Baldrige National Quality Program, to help U.S. businesses and other organizations improve the performance and quality of their operations by providing clear standards and benchmarks of quality.

National Technical Information Service (NTIS) operates a central clearinghouse of scientific and technical information that is useful to U.S. business and industry. NTIS promotes economic growth by (1) collecting, organizing, and disseminating scientific, technical, engineering, and related business information produced by or for federal agencies and (2) providing sophisticated services to other federal agencies that help them interact with and better serve the information needs of their own constituents.

To enable TA to continue to promote the development and diffusion of technologies and standards critical to sustained economic growth for our nation's communities through a comprehensive mix of policy and programmatic activities, the President requests a total of $504.8 million for the Technology Administration and its component agencies. The summary provided below describes the requested funding levels for FY 2004:

Office of the Under Secretary for Technology/Office of Technology Policy
Total funding requested: $8 million

National Institute of Standards and Technology
Total funding requested: $496.8 million

National Technical Information Service
No funds requested; NTIS is a self-supporting agency.

President Bush requests $8.015 million for the Office of the Under Secretary for Technology and the Office of Technology Policy (US/OTP). This request supports US/OTP in its work with the private sector to analyze, develop, coordinate, and advocate national policies that maximize technology's contribution to the war on terrorism, homeland security, job creation, and economic growth and security. More than ever before, technological leadership is vital to U.S. national interests. America's success in meeting its security and economic goals depends largely on its ability to harness the power and promise of leading-edge advances in technology.

The FY 2004 budget request will support:

The Under Secretary for Technology in overseeing the Technology Administration's operating units. The Under Secretary advises the Secretary of Commerce and the Technology Administration's component agencies on domestic and international technology and serves as an advocate for innovation and industrial competitiveness within government and the private sector. The Under Secretary provides policy guidance to the Secretary of Commerce and the Technology Administration's component agencies, serves as an interagency leader on such efforts as the President's National Science and Technology Council and as an advocate for innovation and industrial competitiveness within and outside government, and provides leadership within the Department as chair of the Commerce Coordinating Council for Technology (C3T). The Under Secretary coordinates the civilian technology efforts of federal agencies and helps to shape federal civilian R&D priorities by taking into account the issues faced by industry. The Under Secretary also provides counsel to the Secretary of Commerce on all matters affecting innovation and coordinates with counterpart offices in the trade and economic agencies to create unified, integrated trade and technology policies.

The Office of Technology Policy's (OTP) role in supporting and improving the American innovation system through its leadership of interagency working groups, community outreach events, and workshops to identify barriers to and best practices of America's innovation system. OTP's work includes advancing the role technology plays in U.S. economic growth and homeland security, through facilitation of dialogue and interaction among policymakers, developers, and users of emerging and productivity-enhancing technology, with the goal of promoting adoption by business, education, medicine, and research groups. The OTP administers the National Medal of Technology, the highest honor awarded by the President of the United States for technological innovation. Also within the OTP, the Office of Technology Competitiveness promotes domestic technological competitiveness in four interrelated policy areas: technology development and transfer, business innovation, state and local efforts to promote technology-based economic growth, and work force preparation for a technology-driven future. The Office works closely with industry, conducts issue analyses, disseminates reports and other useful information, and supports the Assistant Secretary in developing and advocating policy tools that can advance U.S. innovation, technological growth, and competitiveness. Within OTP, the Office of International Technology promotes international technology partnerships to strengthen U.S. competitiveness and advocates policies to advance U.S. technology in the global economy. The proposed budget also will support publication of policy papers and promotion of the GetTech Web site.

OTP is initiating an examination of the effects of globalization and policies on U.S. high-tech industries and the scientific and technological workforce. Data will be collected from international counterparts and results will be used to highlight actions and recommend policies that may help foster U.S. competitiveness.

The budget request calls for transferring the Office of Space Commercialization (OSC) from the Technology Administration to the International Trade Administration (ITA) within the Department of Commerce, which will require a legislative change. The Department proposes to enhance management efficiencies and give greater emphasis to space commercialization issues through this consolidation. OSC is aligned closely with ITA's Office of Aerospace and ITA's Office of Policy and Strategic Planning. They work with similar government and industry partners and with similar mission areas. The merger of OSC with ITA will leverage ITA's greater industry resources. In addition, the technology advocated by OSC has matured significantly over the last several years, resulting in increased numbers of trade agreements. The two organizations and the industries they advocate could benefit from a merger leveraging the experience of the TA OSC experts in the space industry and the infrastructure and expertise of ITA's personnel in negotiating meaningful trade agreements. The President's FY 2004 submission provides for funding of OSC through the International Trade Administration and removes it from the Technology Administration budget.

A strong technology base is playing a key role in helping the United States to win the war on terrorism, strengthen our nation's security, and improve our economic growth and global competitiveness. As it has for more than a century, the National Institute of Standards and Technology is working to ensure America's leadership in science and technology and hasten the flow of new knowledge, new capabilities, and new products. NIST research, products, and services promote technological innovation—the driving force for about 50 percent of U.S. economic growth and a key to enhancements in national security and homeland security.

The budget requested for fiscal year (FY) 2004 will help NIST to develop the cutting-edge science and technology infrastructure needed to strengthen and safeguard America's economic foundations and security capabilities now and in the future.

The Administration's FY 2004 NIST budget request to the Congress is $496.8 million, a decrease of $66.3 million compared to the FY 2003 budget request of $563.1 million. The budget request focuses on NIST's core mission of measurements, standards, and laboratory research, and on providing the 21st-century facilities the NIST Laboratories need for success. Investment of limited NIST resources in the Laboratory programs and facilities will have the greatest impact on strengthening homeland security and fostering innovation that leads to economic growth.

The NIST FY 2004 budget request is divided into three appropriations:

$387.6 million for Scientific and Technical Research and Services (STRS), including $381.8 million for the NIST Laboratories and $5.8 million for the Baldrige National Quality Program (BNQP). The budget request includes a proposed increase of $10.3 million for NIST to address key national needs in homeland security and $9.2 million to expand NIST work in the areas of nanotechnology, quantum information science, and health care quality assurance—areas that will contribute to strengthening our nation's economy. In addition, the budget requests $6.7 million for equipment and maintenance of the world-class Advanced Measurement Laboratory scheduled to open in June 2004, and $1.5 million for backup of NIST's time scale and time dissemination systems.

$39.6 million for Industrial Technology Services, including $27 million for the Advanced Technology Program (ATP) and $12.6 million for the Manufacturing Extension Partnership (MEP). Consistent with the Administration's emphasis on shifting resources to reflect changing needs, the FY 2004 budget proposes terminating the ATP. The budget request for the ATP represents a decrease of $80 million from the FY 2003 request and is for administrative and closeout costs. The budget request for the MEP, which provides manufacturing and business assistance to small manufacturing establishments, maintains the FY 2003 budget policy of significantly reducing federal funding for MEP. The proposed budget would fund the partnership according to its original plan, which called for the phase out of federal monies to MEP centers after six years of funding, with the goal of making each center self-sufficient. As most MEP centers are more than six years old, federal funding will continue to be provided to only the two centers that are less than seven years old. MEP will focus on providing a central coordination role.

$69.6 million for the Construction of Research Facilities. This includes an increase of $21.3 million to complete several urgently needed construction and renovation projects at NIST's Boulder, Colo., site where most of the buildings are almost 50 years old. In addition, NIST is requesting an additional $3.4 million for critical facilities in Gaithersburg, Md., and $10.6 million for facilities modifications and improvement at both sites.

Following is more information on the FY 2004 budget requested increases for Scientific and Technical Research and Services and Construction of Research Facilities.

SECURING AMERICA'S HOMELAND ($10.3 Million)

For more than 100 years, NIST has provided measurements, standards, and technical advice to help federal, state, and local agencies and the private sector protect U.S. citizens from terrorist, military, and other types of threats and natural disasters.

In the 1930s, NIST forensic experts used their two decades of experience solving crimes to help establish the FBI's laboratory. During World War II, the Institute provided technical advice on everything from the atom bomb to the paper used in war maps. NIST's support for national security has continued through the decades since.

Following are details of NIST's homeland security increases for FY 2004.

Measurement Infrastructure for Homeland Security ($5.3 million)

The United States remains vulnerable to severe loss of life and economic disruption following a terrorist attack on our citizens using chemical, biological, radiological, nuclear, or explosive devices (CBRNE). Many technologies to strengthen homeland security now exist in the laboratory or in pre-deployment stages. But these technologies must be tested, standardized, and certified before they can be implemented broadly.

NIST will develop the measurements, standards, tests, and guidance the government and private sector need to select the most promising homeland security technologies and verify that they function as needed. This work will focus on accelerating the deployment of better technologies and practices for detecting and responding to CBRNE threats. This initiative will be a key part of the national strategy to prevent such catastrophes, thus saving lives and protecting the economy.

Standards, Technology, and Practices for Buildings and First Responders ($4 million)

NIST is playing a key role in enhancing the nation's ability to prevent and respond to terrorism. After the World Trade Center towers survived the initial aircraft impacts, the engineering community was surprised that the towers and other nearby steel frame buildings collapsed due to the effects of fire. NIST is working to determine whether the loss of life and the severe economic consequences could have been minimized through different construction techniques and safety practice. A goal is to ensure that future attacks or natural disasters need not be as devastating.

Using funding received from the Federal Emergency Management Agency in an FY 2002 supplemental appropriation, NIST is leading a broad public-private partnership to determine the technical cause of the collapse of the World Trade Center buildings and apply the lessons learned to save lives and property in the future.

This FY 2004 initiative is one part of that program, focusing on using the results of the World Trade Center investigation to develop cost-effective solutions to strengthen existing and future buildings against attacks and natural disasters. This initiative also will help provide a better understanding of how emergency responders and building occupants behave in a crisis—and to use the lessons learned to help occupants survive future disasters and enable emergency responders to do their jobs more safely and effectively. Guidance and practices based on this study will be disseminated broadly to code-developing organizations and to state and local agencies. The resulting code reforms will further protect property and save lives.

Standards for Biometric Identification ($1 million)

More than 20 million people enter the United States each year. Currently, there is no way to effectively, accurately, and quickly verify the identity of visitors and visa applicants. The USA PATRIOT Act was signed into law in October 2001 to develop a national biometric identification system, using unique physical characteristics such as fingerprints, facial features, and eye patterns, to accurately identify people entering the United States or applying for visas. With the funding requested, NIST will help to develop effective, efficient, and interoperable biometric identifier standards, certification tests, guidelines, and techniques for fingerprint and face recognition and verification.

NANOSCALE MEASUREMENT SCIENCE ($5.2 million)

Nanotechnology is atomic-scale science and engineering that can result in devices and materials with dramatic new properties such as materials 10 times stronger than steel at a fraction of the weight and the potential for supercomputers the size of a sugar cube. Nanotechnology is still largely in the research and development phase. But, in the next 10 to 15 years, many experts believe nanotechnology will have a significant impact on our economy. The National Science Foundation estimates the market could be as much as $1 trillion. European and Asian nations are investing heavily in nanotechnology. Accelerating the transformation of nanotechnology research into actual products could give the United States a dramatic competitive advantage.

NIST measurements, standards, and tests that reduce uncertainties in exploiting quantum mechanical properties of atoms are key requirements to transform research discoveries into reliable and affordable products, services, and manufacturing technologies.

NIST will partner with industry and researchers to develop the measurements and tests needed to ensure that the nation's $710 million federal investment in nanotechnology research and development (FY 2003 President's budget) will result in useful products and services that will put the United States ahead of our global competitors.

QUANTUM INFORMATION SCIENCE ($3 million)

Quantum mechanics, the strange behavior of matter on the atomic scale, provides an entirely new and uniquely powerful way for computing and communications, potentially replacing the current binary computing and digital communications based on ones and zeros, and could have enormous impacts in homeland security. Quantum computers could perform processing tasks that are currently impossible. They also could solve problems that conventional computers could not manage given realistic amounts of time, memory, and processing power.

This enormous computational power would be particularly valuable in cryptography, making codes that are unbreakable by today's best supercomputers, or breaking codes in seconds that could not be cracked in years by the most powerful binary computers. Quantum information also can be used for remarkably secure communications.

With the requested funding, NIST will work to develop the measurements and standards infrastructure (hardware and software) critical to the development of a quantum communications system. This includes methods to test and verify the actual performance characteristics of these systems, to determine their security properties, and to enable integration of such systems into the existing communications infrastructure.

HEALTH CARE QUALITY ASSURANCE ($1 million)

Health care-related measurements such as diagnostic tests cost the United States approximately $200 billion a year, and an estimated $50 billion annually is spent on inaccurate medical measurements requiring repeat tests. The loss of life due to medical measurement errors is difficult to estimate but is thought to be a large fraction of the 100,000 deaths per year attributed to medical treatment errors in general.

The NIST initiative is a first step in a long-term strategy to partner with the health care community to provide the measurements, standards, and data needed to save lives, improve health care quality, and reduce costs through better medical measurements and data quality assurance. The work supported by this initiative will target delivery of measurements and standards for improved diagnosis, treatment, and prevention of disease. It also would promote increased international trade in medical products and services.

NIST requests an increase of $5.5 million for the second round of research equipment needed to realize the capabilities of NIST's Advanced Measurement Laboratory (AML). When it is opened in 2004, the AML will be the world's best measurement laboratory, helping provide the measurements and standards needed by industry and science in key technologies for the 21st century. Making such measurements requires not only the precisely controlled AML environment but also sophisticated scientific equipment. NIST has carefully inventoried the equipment that will be required for research and measurement programs to be housed in the AML.

The AML will include five separate wings to be completed and occupied in stages from FY 2003 to mid-FY 2004. The equipment for the AML is expensive and technologically sophisticated and will require periodic maintenance and recalibration to function properly. NIST has identified about 40 major equipment systems (some specifically tailored for AML work) at a total cost of $40.5 million. Funding for the first 15 systems, totaling $35 million, was requested in the President's budget for FY 2003. Because several months of lead-time are required for purchasing major equipment, NIST must have the funding available in FY 2003 and FY 2004 to permit acquisitions to begin so that the equipment is in place when it is needed.

NIST also is requesting $1.2 million to provide funding for the maintenance and operation of the AML. To provide the advanced measurements and standards needed to support critical technologies, the AML facility needs to be able to maintain strict environmental conditions including temperature, humidity, and air cleanliness. The AML commissioning will begin in FY 2003, and it will be ready for final acceptance in FY 2004. NIST will outsource these maintenance and operational services.

Boulder Laboratory Construction and Renovation ($21.3 million)

The majority of the buildings in NIST's Boulder, Colo., facility are almost 50 years old, and it is becoming increasingly difficult for the Boulder staff to support the research needed for advances in areas such as nanotechnology, information technology, and health care. Boulder researchers estimate that 10 percent of their time is spent coping with wide temperature swings, electric power disruptions, and other problems that hinder sensitive measurements and research. Based on economic impact studies of NIST's measurements and standards, this lost time is estimated to cost this country at least $60 million per year in unrealized economic benefits. The nation and NIST lose enormous additional potential benefits when top NIST scientists spend significant research time working around problems caused by inadequate facilities. Deficient facilities also hamper NIST's ability to retain its most talented and productive scientists. Long-overdue improvements and upgrades to the Boulder facilities will return strong benefits to the economy.

The construction and renovation projects include: completion of the Central Utility Plant ($10.8 million), design and limited renovation of Building 4 ($4 million), and renovation design of Building 1 ($6.5 million).

Safety, Capacity, Maintenance, and Repair ($10.6 million)

The FY 2004 request also includes an increase of $10.6 million for maintenance, repair, and safety improvements at both the Boulder, Colo., and Gaithersburg, Md., campuses. Even with facilities improvements initiated in Boulder and completion of the AML, most NIST facilities are 35 to 50 years old, and the maintenance and safety requirements grow each year.

Gaithersburg Laboratory Renovation ($3.4 million)

NIST is requesting $3.4 million for the renovation design of one of the NIST Gaithersburg General Purpose Laboratories (Building 220).

Critically Needed Backup for NIST Time Services ($1.5 million)

NIST-generated time and frequency standards are critical to the nation's financial, transportation, telecommunications, and emergency services infrastructure. NIST provides the official U.S. time and enables the synchronization of millions of clocks; this service is used several hundred million times each day for purposes ranging from consumer electronic products, to stock market transactions, to navigation. This initiative is needed to secure the NIST time-related services and provide critical backup elements so that these services will not be disrupted as a result of a natural disaster or hostile activities.

The NIST Laboratories provide industry and the science and technology community with the measurement capabilities, standards, evaluated reference data, and test methods that together constitute the equivalent of a common language needed at nearly every stage of a technical activity. NIST provides standards-related information and assistance to about 20,000 organizations and individuals every year. A key measurement and standards function is the development and maintenance of accurate weights and measures that underpin about $4.5 trillion of retail and wholesale U.S. trade, enhance economic efficiency and lower costs.

NIST measurement methods and standards support advances in the $547 billion electronics sector, providing the tools essential to semiconductor manufacturing and the development and use of diverse technologies ranging from magnetic data recording components to the application of sensors and other technologies to forensics, security screening, and other homeland security objectives. NIST supplies the national reference standards that ensure the accuracy of electric power meters in every U.S. home and business.

NIST operates the foremost U.S. fire research laboratory and is the principal R&D agency working to reduce earthquake hazards through improved building codes, standards, and practices for structures and lifelines. NIST supports the U.S. information technology sector, which contributed $827 billion to the gross domestic product in 2000, by developing test methods, computer science and engineering tools that underpin metrology, and open testbeds for industrial collaboration on standards and next-generation information technologies.

NIST provides test and measurement methods, calibrations, reference data, and a technical research base for standards that facilitate interoperable manufacturing systems for the automotive, aircraft, and other industries. NIST calibration services assure that items made at different sites have compatible dimensions. Nearly half the total U.S. trade deficit results from imbalances in trade in mechanical products; NIST has the expertise to help U.S. mechanical manufacturing industries adopt advanced techniques to improve their competitive position.

NIST develops and disseminates national standards for time and frequency to meet critical needs in telecommunications, transportation, and positioning (including support for the Global Positioning System). Each day, NIST receives more than 400 million automated requests for time over the Internet. NIST scientists also seek to discover and measure phenomena that provide the basis for new concepts in computing, information storage, and time keeping. NIST generates, evaluates, compiles, and disseminates fundamental data on the properties of atoms, molecules, and radiation—data needed for the detection of hazardous substances, environmental monitoring and remediation, and efficiency and safety improvements for products and activities ranging from vehicles to power generation.

NIST provides national standards for the radioactive seeds used to treat prostate cancer, which strikes 180,000 men in the United States each year; for 9,500 U.S. mammography facilities, helping to assure the effectiveness of 25 million diagnostic mammograms annually; and for radioactive sources used—for example—in a promising research application to improve the efficacy of balloon angioplasty procedures. Each year, more than 1,700 researchers participate in studies at the NIST Center for Neutron Research, a world-class facility where unique instruments reveal the inner structure and dynamics of virtually any material.

In FY 2002, NIST participated in 125 Cooperative Research and Development Agreements (CRADAs) focusing on collaborative R&D efforts of mutual interest with for-profit organizations, non-profit organizations (including universities), public and private foundations, state and local governments, and individuals. Since 1988, NIST has signed nearly 1,000 CRADAs.

In the FY 2004 budget, the request for the Laboratories ($381.8 million in Scientific and Technical Research and Services) and for facilities ($69.6 million in Construction of Research Facilities) will support further development of critical measurement technologies, methods, and services needed by the United States to promote technological progress, improve products and services, and enhance international competitiveness. For example, as part of their FY 2004 base programs, the NIST Laboratories will:

Support the U.S. electronics and electrical industries, their suppliers, and their customers, including the U.S. government, by providing the measurement capability needed to improve America's competitive position. Activities include providing measurement techniques, data, physical models, and fundamental understanding to enhance the reliability of advanced insulating films; offering new measurement technology and services to support further development of optical communications systems; and developing metrology for key photonic materials used in data storage, microwave communications, and high-power, high-temperature electronics.

Provide measurement methods, calibration standards, and a technical research base for standards that facilitate interoperable manufacturing systems. Activities include developing conformance tests for a standard that will enable data exchange among part design, process planning, and machining; disseminating calibrated overlay standards and measurement procedures to the U.S. semiconductor manufacturing industry to improve productivity and lower costs of manufacturing microelectronic devices; and developing test methods for information security approaches and products applied to real-time industrial control systems.

Serve as the nation's primary reference laboratory for chemical, biochemical, and chemical engineering measurements by providing the underlying scientific and engineering measurements, standards, data, predictive methods, and calibration and measurement services. Activities include developing methods to ensure that the accuracy and precision of DNA testing in the United States is based on well-qualified standards produced at and certified by NIST; developing measurement methods, data, and models to enable U.S. industry to characterize and manipulate the physical and chemical nanoscale structures in commercial devices; and developing primary reference measurement methods and standards for health status markers to help medical professionals improve patient care and reduce health-care costs.

Support U.S. industry by providing measurement services and research for optical, electronic, magnetic, and radiation technologies and fundamental physical quantities. Activities include determining the effects of nanoscale magnetic impurities on the electronic structure of metals; developing standards and measurement techniques to enable the application of brachytherapy techniques to treat breast cancer; and developing second-generation, high accuracy cryogenic radiometers to enable superlative optical power measurements over a wider measurement range.

Address the scientific, measurement infrastructure, data, and standards issues that are crucial to the success of American industry in developing and using advanced materials. Activities include developing techniques needed by the U.S. microelectronics industry to more quickly and economically design a new generation of products; developing measurement methods, standards, and data to aid the U.S. automotive industry in using lightweight materials in future energy-efficient vehicles; and developing unique facilities and tools needed to measure the properties of nanostructured materials.

Provide measurement technologies and performance prediction methods to enhance the safety, security, life-cycle quality, and economy of constructed facilities. Activities include completing a best-practices guide for using "alternative means" provisions in building codes to meet life-safety performance objectives for fire design; developing a software tool to enable facility owners, designers, and managers to choose cost-effective strategies for protection from terrorist and environmental risks; and completing a best-practice guide on the prevention of progressive collapse in multistory buildings.

Conduct research and provide technical support in the development and use of computer and related telecommunications systems. Activities include developing benchmark security standards and tests to assure correct implementation of security standards and guidelines to support homeland defense and the critical infrastructure protection needs of federal agencies; developing biometrics standards and related testing to support commercial applications; and developing a state-of-the-art testbed for highly secure quantum-based communications.

The Baldrige National Quality Program helps U.S. businesses and other organizations continuously improve their competitiveness and productivity by adopting quality and performance management practices. The program helps many types of companies and organizations deliver ever-improving value to customers, while improving overall organizational effectiveness. It creates a performance excellence standard that fosters communications and sharing in the private sector, building networks to deliver performance and quality management information and services and to share lessons learned with other economic sectors.

Baldrige award applicants receive 300 to 1,000 hours of review by at least six experts on the board of examiners, giving the applicants valuable insights. The experts provide a detailed feedback report on the organization's strengths and opportunities for improvement. Since 1988, 44 organizations have received the Baldrige award, which is given in the categories of manufacturing, service, small business, education, and health care. Many thousands of organizations use the Baldrige criteria internally to assess and improve their performance.

The proposed FY 2004 appropriation of $5.8 million will be used to manage the annual award competition, conduct a conference at which Baldrige award winners will share their performance excellence strategies, maintain a comprehensive database on state and local quality awards, and facilitate information sharing among all sectors of the U.S. economy.

Advanced Technology Program (ATP)

The Advanced Technology Program assists industry to invest in and develop high-risk, innovative technologies that promise broad benefits to the nation. While this program has been well run and effective, scarce resources are needed for higher priority programs, and the FY 2004 budget proposes terminating the ATP. The budget requests $27 million for administrative and closeout expenses.

Manufacturing Extension Partnership (MEP)

The MEP strengthens the technological capability, productivity, and global competitiveness of small manufacturing establishments by providing access to industrial resources, services, and expertise. Centered on best practices, manufacturing methodologies, and training, these resources, services, and expertise are provided through a nationwide network of manufacturing extension centers. More than 400 MEP centers and field offices serving all 50 states and Puerto Rico help small manufacturing establishments through the cost-shared, cooperative efforts of NIST, state and local governments, and local extension service providers. Each center uses the network to provide cost-effective services that are responsive to the needs of local manufacturers.

The $12.6 million FY 2004 budget request maintains the President's FY 2003 budget policy of reducing federal funding for the MEP centers. MEP's original statute required federal funding for each center to be phased out after six years, with the goal of making each center self-sufficient. The MEP will continue to pursue mechanisms that encourage and promote revenue generation to minimize the overall federal investment while ensuring that the mission of serving small manufacturers is not compromised.

NIST management goals and processes support each element of the President's Management agenda. In FY 2004, NIST will pursue continued improvements in each of these areas:

Strategic Management of Human Capital

Competitive Sourcing

Improved Financial Performance

Expanded Electronic Government

Budget and Performance Integration

R&D Investment Criteria

This final category, R&D Investment Criteria, is a key component of NIST's management strategy. Rigorous, open, technically sound, and competitive processes are the hallmark of NIST's work. All of NIST's programs are merit-based and externally peer reviewed, and NIST continually strives to maintain its reputation for accuracy, quality, and integrity in all of its functions.

NIST has been a leader in the development of criteria for evaluating investments in federal research and development programs. To date, the R&D investment criteria center on the evaluation of quality, relevance, and performance. In keeping with this approach, NIST uses a combination of external peer review, output tracking, and retrospective economic impact studies to evaluate quality, relevance, and performance over time. NIST's peer review process is particularly productive, as it is comprehensive and ultimately focused on evaluating the quality, relevance, and effectiveness of NIST's efforts to serve its customers' current and prospective measurement and standards needs.

To evaluate prospective investment choices, NIST has recently completed a long-term strategic plan (NIST 2010) that used a combination of external trend analysis and specific opportunity assessments to identify areas where NIST's measurement, standards, and advisory services are critical to technological advancements that have enormous potential impact on the nation's productivity, trade, and quality of life. The priorities described in the Commerce Department's FY 2004 Annual Performance Plan reflect that long-term strategic assessment.

Where feasible, NIST also contracts for focused prospective economic analyses that estimate the costs associated with inadequate technical infrastructure in specific markets. Most recently, NIST sponsored a study of the software industry and found that the annual national costs of inadequate infrastructure for software testing ranges from $22.2 to $59.5 billion (more than half of these costs derive from error avoidance and mitigation activities of software users; the remaining costs reflect the additional testing resources that software developers must use due to inadequate testing tools and methods). Prospective studies of this nature are used to help NIST refine its investment choices within specific arenas of potential work.

NIST augments these evaluation methods with continual feedback from customers as well as broad policy and management oversight by the Visiting Committee on Advanced Technology. Additionally, the Baldrige National Quality Program, the Advanced Technology Program, and the Manufacturing Extension Partnership each have an outside board that reviews and assesses the performance of these programs. These mechanisms provide additional means for aligning NIST's work with customer needs and managing its programs in the most effective manner possible.

Laboratory programs are planned and implemented in cooperation with industry and rigorously evaluated to ensure that industry and taxpayers are receiving the greatest possible return on their investment. Since 1959, the National Research Council has managed panels of industry, academic, and government experts who annually review NIST laboratory programs. The most recent review states that the "technical quality of the ongoing work remains quite high overall. In addition, each laboratory had instances of work that was outstanding in its excellence, in its creativity, or in the level of technical skill demonstrated."

Economic impact studies of NIST's laboratory programs consistently show that NIST's technology and technical services have a powerful positive impact on U.S. firms and the overall economy. For example, accurate, real-time monitoring of polluting gases emitted by electric utilities, automobiles, and other sources depends heavily on equipment calibration standards made by or traceable to NIST. A 2002 study on gas mixture NIST-Traceable Reference Materials program—an innovative mechanism for meeting a high demand for standards—returns between $21 and $27 in benefits for every dollar spent, with substantial benefits extending into the future.

Another recent economic study found that a number of U.S. industries already are saving millions of dollars a year, and could save a total of more than $900 million annually, by using the Standard for Exchange of Product model data (STEP). STEP is a suite of international standards that reduce interoperability problems encountered in the exchange of digital product information. The study found that NIST's administrative and technical activities accelerated the development and adoption of STEP, yielding a net present value economic impact of $180 million (2001 dollars) and a benefit-to-cost ratio of almost 8 to 1.

OTHER RECENT NIST ACHIEVEMENTS

The Malcolm Baldrige National Quality Award, the nation's premier award for performance excellence and quality achievement, was awarded in 2002 for the first time to a health care organization—SSM Health Care, St. Louis, Mo. Other 2002 Baldrige Award recipients are: Motorola Inc. Commercial, Government and Industrial Solutions Sector, Schaumburg, Ill. (manufacturing category) and Branch-Smith Printing Division, Fort Worth, Texas (small business category). Commerce Secretary Don Evans praised the "extraordinary results" of the winners and noted that they "represent the highest ethical standards in public responsibility and corporate stewardship." Commending all the honorees for their outstanding accomplishments and contributions to our society, President Bush particularly applauded the first health care winner for demonstrating "the ability to meet market challenges while improving the quality of compassionate health care."

Software and diagnostic hardware technology developed with co-funding from the Advanced Technology Program recently helped scientists gain a much better understanding of how Huntington's disease progresses in the body. Researchers hope the new technologies eventually can be applied to a variety of diseases and conditions, providing the detailed biomedical information needed to design earlier and more effective treatments. An international research collaboration used software created by 3rd Millennium of Cambridge, Mass., and DNA microarray technology from Affymetrix, Santa Clara, Calif., to learn how a cascade of biological events produces Huntington's disease, a degenerative brain disorder. The researchers used a system custom-built by 3rd Millennium, which developed the underlying software technology with ATP support. Data files used in the project were obtained with "DNA chip" technology from Affymetrix, also developed with ATP support. These miniaturized, key-chain-sized laboratories can be customized to rapidly analyze, for example, all gene activities in an organism.

In business since 1964, Garrett Metal Detectors of Garland, Texas, is a worldwide supplier of security equipment to airports, law enforcement agencies, schools, and sporting events, including the 2002 Olympic Winter Games in Salt Lake City. After Sept. 11, 2001, requests for Garrett's metal detecting equipment skyrocketed. With help from the Texas Manufacturing Assistance Center (TMAC), an affiliate of the nationwide NIST Manufacturing Extension Partnership (MEP), this small manufacturer has been able to keep pace with demand. Last year, Garrett officials worked with the Texas center to implement ISO 9000 quality standards and to help redesign the company's walk-through metal detector operations. According to the company vice president, cycle time was reduced by 75 percent and production increased by 300 percent to 400 percent with the same number of people and half the space.

A highly sensitive, inexpensive "lab-on-a-chip" that provides warning within seconds of even trace amounts of toxic chemicals in water was designed and demonstrated recently by NIST scientists and collaborators. The prototype sensor system monitors the natural response of bacterial cells bound within the microscopic channels of a plastic microfluidics device—a miniaturized chemical and biochemical analysis system. In the presence of certain chemicals, the cells eject large amounts of potassium, which is detected with an optical sensor that changes color. The prototype was demonstrated as part of an early warning system for industrial pollutants that interfere with sewage treatment, but it also has potential homeland security applications. Although this type of chemical test could be performed in other formats, a microfluidics device is more sensitive and faster, consumes less reagent and sample material, and could be used in a distributed sensor network for real-time field testing.

The NIST Center for Neutron Research (NCNR) began offering the more than 1,700 scientists who use the national facility annually enhanced capabilities, featuring a variety of improvements. The top facility of its kind in the country, the NCNR has successfully developed advanced cooling technology that nearly doubles the number of very-long-wavelength neutrons available for experiments on objects such as fuel cells, cell membranes, superconductors and nanotubes. Last year, experiments conducted at the NCNR involved researchers representing more than 100 U.S. universities, 50 U.S. industrial laboratories, and over 30 government laboratories. A report issued in 2002 by the White House Office of Science and Technology Policy (OSTP) noted that neutron probes are becoming increasingly indispensable research tools in fields ranging from biology to materials science, but concludes that only one U.S. facility—NIST's NCNR—provides a broad range of world-class capabilities.

Draft guidelines produced by NIST will help federal agencies and others protect against cyberattacks on their computer systems. The new guidelines detail, for the first time, a systematic way to assess the security level of entire computer systems, including extensive computer networks. The guidelines include a hierarchy to organize security controls for confidentiality, data integrity, and availability. While NIST developed the guidelines (which will be finalized in FY 2003) for federal agencies, the private sector and the military can adapt them easily for their use.

NIST began offering a new testing service to help ensure the accuracy of lasers used in vision correction surgery and in the production of computer chips. To create excimer lasers (lasers that produce short bursts of energy at short wavelengths) that are suitable for precision applications like eye surgery, manufacturers must measure accurately the amount of laser power and pulse energy their devices emit. The NIST service provides a way to better measure the performance of laser systems.